UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


WASHINGTON,
D.C. 20549





FORM
10-Q/A


(Amendment
No. 1)





x
            Quarterly
      Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of
      1934





For the
fiscal quarter ended March 31, 2008





 ̈
            Transition
      Report under Section 13 or 15(d) of the Securities Exchange Act of 1934.





For the
transition period from ________ to ________.





Commission
File No. 0-26669


Can-Cal Resources Ltd.


(Name of
Small Business Issuer in its charter)





Nevada
            
            88-0336988(State
      or other jurisdiction of
            
            (I.R.S.
      Employer Identification No.)incorporation
      or organization)





2500
Vista Mar Drive, Las Vegas, NV 89128





(Address
of principal executive offices)





(702)
243-1849





(Issuer's
telephone number)





N/A





(Former
name, former address and former fiscal year, if changed since last
report)





Check
whether the issuer (1) filed all reports required to be filed by Section 13 or
15(d) of the Exchange Act during the past 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been subject
to such filing requirements for the past 90 days. Yes x  No  ̈





APPLICABLE
ONLY TO CORPORATE ISSUERS





State the
number of shares outstanding of each of the issuer's classes of common equity,
as of the latest practicable date:





Class
            
            Outstanding
      on May 19, 2008Common
      Stock, Par Value $.001.
            
            24,587,753





Transitional
Small Business Disclosure Format (Check one): Yes  ̈  No x










EXPLANATORY
NOTE





This
quarterly report on Form 10-Q/A (“Form 10-Q/A”) for the fiscal quarter
ended March 31, 2008 is filed to amend the following:





·
            The
      statements of operations and statements of cash flows, as well as
      footnotes #1 and #4, within Item 7 of Part I have been amended to present
      the Company’s financial statements in accordance with the required
      presentation. As an Exploration Stage Company, under paragraph 11 of SFAS
      7 the Company has to include certain unaudited “inception to date”
      amounts.





·
            Item
      4T of Part I to comply with items 307 and 308(c) of the Regulation S-B
      which require that we conclude on the effectiveness of our disclosure
      controls and procedures.





Events
have taken place that would have been reflected in the original Form 10-Q if
they had taken place prior to the date of the original and amended filings. The
Company recommends this report be read in conjunction with the Company’s reports
filed subsequent to May 20, 2008.








CAN CAL
RESOURCES LTD


(AN EXPLORATION STAGE COMPANY)


MARCH 31,
2008 QUARTERLY REPORT ON FORM 10-Q


TABLE OF
CONTENTS


PAGE NO.PART
      I.
              FINANCIAL
      INFORMATION
              3ITEM
      1.
              FINANCIAL
      STATEMENTS
              3Balance
      Sheets
              3Statements
      of Operations
              4Statements
      of Stockholders Equity (Deficit)
              5Statements
      of Cash Flows
              6Notes
      to Financial Statements
              7ITEM
      2.
              Management's
      Discussion and Analysis of Financial Condition
              12ITEM
      3.
              Quantitative
      and Qualitative Disclosures about Market Risk
              14ITEM
      4.
              Controls
      and Procedures
              14PART
      II.
              OTHER
      INFORMATION
              15ITEM
      1.
              Legal
      Proceedings
              15ITEM
      2.
              Changes
      in Securities
              15ITEM
      3.
              Defaults
      upon Senior Securities
              15ITEM
      4.
              Submission
      of Matters to a Vote of Security Holders
              15ITEM
      5.
              Other
      information
              15ITEM
      6.
              Exhibits
      and Reports on Form 8-K
              15Signatures
              15Certifications




1


FORWARD
LOOKING STATEMENTS





Section
27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act
of 1934 provide a "safe harbor" for forward looking statements that are based on
current expectations, estimates and projections, and management's beliefs and
assumptions. Words such as "believes," "expects," "intends," "plans,"
"estimates," "may," "attempt," "will," "goal," "promising," or variations of
such words and similar expressions are intended to identify such forward-looking
statements. These statements are not guarantees of future performance and
involve certain risks and uncertainties which are difficult or impossible to
predict. Therefore, actual outcomes and results may differ materially from what
is expressed or forecasted in such forward-looking statements. The Company
undertakes no obligation to update publicly any forward-looking statement
whether as a result of new information, future events or otherwise.





Such
risks and uncertainties include, but are not limited to, the availability of
metal ore; negative or inconsistent test results, the existence of precious
metals in the metal ore available to the Company in an amount which permits
their production on an economic basis; the Company's ability to drill holes and
properly test and assay samples, and its ability to locate and acquire mineral
properties which contain sufficient grades of precious metals and/or minerals;
the Company's ability to sell a portion or all of any of its properties to
larger mining companies, or to enter into agreements with larger mining
companies to explore and possibly develop its properties; to produce precious
metals on a commercial basis, the prices of precious metals; obtaining a mill or
refinery to extract precious metals on an economic basis; the ability to
maintain the facilities it currently utilizes; obtain permitting requirements
for any mining and milling operations and pay the costs thereof; have good title
to claims and equipment; and the Company's ability to obtain financing necessary
to maintain its operations.


2


PART I.
FINANCIAL INFORMATION





ITEM 1.
FINANCIAL STATEMENTS





CAN-CAL
RESOURCES LTD


(AN EXPLORATION STAGE COMPANY)


CONDENSED
BALANCE SHEETS




March
      31,
              
              
              December
      31,2008
              
              
              2007(Unaudited)
              
              
              (Audited)ASSETSCurrent
      assetsCash
              
              $
              21,260
              
              
              $
              105,987Other
      current assets
              
              
              1,995
              
              
              
              -Total
      current assets
              
              
              23,255
              
              
              
              105,987Fixed
      assets, net
              
              
              64,951
              
              
              
              67,948Other
      assets, net
              
              
              446,915
              
              
              
              445,667Total
      assets
              
              $
              535,121
              
              
              $
              619,602LIABILITIES
      AND STOCKHOLDERS' DEFICITCurrent
      liabilitiesAccounts
      payable
              
              $
              19,303
              
              
              $
              28,399Accrued
      interest
              
              
              324,830
              
              
              
              311,320Accrued
      officer salary
              
              
              130,149
              
              
              
              110,652Accrued
      payroll taxes
              
              
              1,640
              
              
              
              21,853Notes
      payable, related parties
              
              
              382,550
              
              
              
              360,550Unearned
      revenues
              
              
              3,750
              
              
              
              9,375Total
      current liabilities
              
              
              862,222
              
              
              
              842,149Total
      liabilities
              
              
              862,222
              
              
              
              842,149Stockholders'
      deficitPreferred
      stock; $0.001 par value; 10,000,000 sharesauthorized,
      no shares issued and outstanding
              
              
              -
              
              
              
              -Common
      stock; $0.001 par value; 100,000,000 sharesauthorized,
      24,587,753 shares issued and outstanding
              
              
              24,588
              
              
              
              24,555Additional
      paid-in capital
              
              
              7,831,503
              
              
              
              7,823,411Accumulated
      deficit
              
              
              (8,183,192
              )
              
              
              (8,070,513
              )Total
      stockholders' deficit
              
              
              (327,101
              )
              
              
              (222,547
              )Total
      liabilities and stockholders' deficit
              
              $
              535,121
              
              
              $
              619,602





See
Accompanying Notes to Financial Statements


3





CAN-CAL
RESOURCES LTD


(AN EXPLORATION STAGE COMPANY)


CONDENSED
STATEMENTS OF OPERATIONS


(UNAUDITED)





For the Three Months Ended
            
            March 22, 1995March 31,
            
            (Inception)2008
            
            2007
            
            to March 31, 2008Material
      sales
            
            $
            -
            
            $
            -
            
            $
            245,500Cost
      of sales
            
            
            -
            
            
            -
            
            
            263,400Gross
      profit
            
            
            -
            
            
            -
            
            
            (17,900
            )ExpensesExploration
      costs
            
            
            17,914
            
            
            47,308
            
            
            386,441Depreciation
            
            
            2,997
            
            
            2,205
            
            
            223,322General
      and administrative
            
            
            56,995
            
            
            48,494
            
            
            5,814,021Officer
      compensation
            
            
            30,992
            
            
            31,166
            
            
            642,168Total
      operating expenses
            
            
            108,898
            
            
            129,173
            
            
            7,065,952Loss
      from operations
            
            
            (108,898
            )
            
            (129,173
            )
            
            (7,083,852
            )Other
      income (expense)Other
      income from legal judgement
            
            
            -
            
            
            -
            
            
            47,200Interest
      income
            
            
            98
            
            
            3,454
            
            
            52,886Rental
      revenue
            
            
            9,925
            
            
            5,625
            
            
            241,925Gain
      (loss) on sale of fixed assets
            
            
            -
            
            
            -
            
            
            26,801Interest
      expense
            
            
            (13,804
            )
            
            (14,580
            )
            
            (994,552
            )Total
      other income (expense)
            
            
            (3,781
            )
            
            (5,501
            )
            
            (625,740
            )Loss
      before provision for income taxes
            
            
            (112,679
            )
            
            (134,674
            )
            
            (7,709,592
            )Provision
      for income taxes
            
            
            -
            
            
            -
            
            
            -Net
      loss from continuing operations
            
            
            -
            
            
            -
            
            
            (7,709,592
            )Income
      from discontinued operationsIncome
      (loss) from discontinued operations
            
            
            -
            
            
            -
            
            
            116,400Gain
      (loss) on disposal of operations (net of taxes)
            
            
            -
            
            
            -
            
            
            (590,000
            )Net
      loss
            
            $
            (112,679
            )
            $
            (134,674
            )
            $
            (8,183,192
            )Basic
      loss per common share
            
            $
            (0.00
            )
            $
            (0.01
            )Basic
      weighted average common shares outstanding
            
            
            24,581,984
            
            
            23,683,895





See
Accompanying Notes to Financial Statements


4


Can-Cal
Resources Ltd.
 (An
Exploration Stage Company)
 Condensed
Statement of Stockholders' Equity (Deficit)
 (Unaudited)


ForeignCommon
      Stock
              
              Additional
              
              
              
              Currency
              
              
              
              TotalNumber
      of
              
              
              
              Paid-in
              
              
              
              Translation
              
              Accumulated
              
              Stockholders'Shares
              
              Amount
              
              Capital
              
              Unamortized
              
              Adjustment
              
              (Deficit)
              
              (Deficit)Balance
      March 22, 1995
              
              
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -Common
      shares issued for services
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -Net
      loss
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (1,000
              )
              
              (1,000
              )Balance
      December 31, 1995
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (1,000
              )
              
              (1,000
              )Common
      shares issued for services
              
              
              3,441,217
              
              
              3,400
              
              
              625,000
              
              
              -
              
              
              -
              
              
              -
              
              
              628,400Prior
      period adjustment, investment in joint venture
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              497,900
              
              
              497,900Net
      loss
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (497,000
              )
              
              (497,000
              )Balance
      December 31, 1996
              
              
              3,441,217
              
              
              3,400
              
              
              625,000
              
              
              -
              
              
              -
              
              
              (100
              )
              
              628,300Common
      shares issued for services
              
              
              3,006,435
              
              
              3,000
              
              
              1,051,400
              
              
              -
              
              
              -
              
              
              -
              
              
              1,054,400Net
      loss
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (1,044,700
              )
              
              (1,044,700
              )Balance
      December 31, 1997
              
              
              6,447,652
              
              
              6,400
              
              
              1,676,400
              
              
              -
              
              
              -
              
              
              (1,044,800
              )
              
              638,000Common
      shares issued for cash
              
              
              557,509
              
              
              600
              
              
              211,200
              
              
              -
              
              
              -
              
              
              -
              
              
              211,800Foreign
      currency translation adjustment
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              8,500
              
              
              -
              
              
              8,500Net
      loss
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (353,000
              )
              
              (353,000
              )Balance
      December 31, 1998
              
              
              7,005,161
              
              
              7,000
              
              
              1,887,600
              
              
              -
              
              
              8,500
              
              
              (1,397,800
              )
              
              505,300Common
      shares issued for cash
              
              
              1,248,621
              
              
              1,200
              
              
              572,600
              
              
              -
              
              
              -
              
              
              -
              
              
              573,800Foreign
      currency translation adjustment
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (11,800
              )
              
              -
              
              
              (11,800
              )Realized
      foreign currency translation loss
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              3,300
              
              
              -
              
              
              3,300Prior
      period Adjustment
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              15,000
              
              
              15,000Elimination
      of subsidiary upon disposal
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              116,400
              
              
              116,400Net
      loss
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (1,038,500
              )
              
              (1,038,500
              )Balance
      December 31, 1999
              
              
              8,253,782
              
              
              8,200
              
              
              2,460,200
              
              
              -
              
              
              -
              
              
              (2,304,900
              )
              
              163,500Common
      shares issued for cash
              
              
              1,119,009
              
              
              1,200
              
              
              948,400
              
              
              -
              
              
              -
              
              
              -
              
              
              949,600Net
      loss
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (962,500
              )
              
              (962,500
              )Balance
      December 31, 2000
              
              
              9,372,791
              
              
              9,400
              
              
              3,408,600
              
              
              -
              
              
              -
              
              
              (3,267,400
              )
              
              150,600Common
      shares issued for cash
              
              
              785,947
              
              
              800
              
              
              81,500
              
              
              -
              
              
              -
              
              
              -
              
              
              82,300Net
      loss
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (704,500
              )
              
              (704,500
              )Balance
      December 31, 2001
              
              
              10,158,738
              
              
              10,200
              
              
              3,490,100
              
              
              -
              
              
              -
              
              
              (3,971,900
              )
              
              (471,600
              )Common
      shares issued for cash
              
              
              1,093,280
              
              
              1,100
              
              
              269,900
              
              
              -
              
              
              -
              
              
              -
              
              
              271,000Common
      shares issued for services
              
              
              92,292
              
              
              100
              
              
              23,800
              
              
              -
              
              
              -
              
              
              -
              
              
              23,900Options
      granted for services
              
              
              -
              
              
              -
              
              
              7,100
              
              
              -
              
              
              -
              
              
              -
              
              
              7,100Common
      shares issued for repayment of note payable, related party in the amount
      of $119,800, including accrued interest of $71,800
              
              
              309,677
              
              
              300
              
              
              119,500
              
              
              -
              
              
              -
              
              
              -
              
              
              119,800Warrants
      granted for loan fees onconvertible
      notes payable, related party
              
              
              -
              
              
              -
              
              
              16,700
              
              
              (16,700
              )
              
              -
              
              
              -
              
              
              -Common
      shares issued for loan fees onconvertible
      notes payable, related party
              
              
              30,000
              
              
              -
              
              
              13,500
              
              
              (13,500
              )
              
              -
              
              
              -
              
              
              -Deemed
      interest on beneficial conversionfeature
      of notes payable, related party
              
              
              -
              
              
              -
              
              
              20,500
              
              
              -
              
              
              -
              
              
              -
              
              
              20,500Amortization
      of loan fees
              
              
              -
              
              
              -
              
              
              -
              
              
              8,200
              
              
              -
              
              
              -
              
              
              8,200Net
      loss
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (709,300
              )
              
              (709,300
              )Balance
      December 31, 2002
              
              
              11,683,987
              
              
              11,700
              
              
              3,961,100
              
              
              (22,000
              )
              
              -
              
              
              (4,681,200
              )
              
              (730,400
              )Common
      shares issued for cash
              
              
              823,410
              
              
              800
              
              
              163,900
              
              
              -
              
              
              -
              
              
              -
              
              
              164,700Common
      shares issued for services
              
              
              381,260
              
              
              400
              
              
              63,800
              
              
              -
              
              
              -
              
              
              -
              
              
              64,200Options
      granted for services
              
              
              -
              
              
              -
              
              
              61,300
              
              
              -
              
              
              -
              
              
              -
              
              
              61,300Common
      shares issued for repayment of note payable, related party in the amount
      of $78,300, including accrued interest of $43,300
              
              
              364,305
              
              
              400
              
              
              77,900
              
              
              -
              
              
              -
              
              
              -
              
              
              78,300Deemed
      interest on beneficial conversionfeature
      of notes payable, related party
              
              
              -
              
              
              -
              
              
              38,300
              
              
              -
              
              
              -
              
              
              -
              
              
              38,300Amortization
      of loan fees
              
              
              -
              
              
              -
              
              
              -
              
              
              15,000
              
              
              -
              
              
              -
              
              
              15,000Net
      loss
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (711,100
              )
              
              (711,100
              )Balance
      December 31, 2003
              
              
              13,252,962
              
              
              13,300
              
              
              4,366,300
              
              
              (7,000
              )
              
              -
              
              
              (5,392,300
              )
              
              (1,019,700
              )Common
      shares issued for cash
              
              
              1,564,311
              
              
              1,600
              
              
              306,400
              
              
              -
              
              
              -
              
              
              -
              
              
              308,000Common
      shares issued for exercise of warrants
              
              
              701,275
              
              
              700
              
              
              124,900
              
              
              -
              
              
              -
              
              
              -
              
              
              125,600Common
      shares issued for services
              
              
              390,224
              
              
              400
              
              
              73,800
              
              
              -
              
              
              -
              
              
              -
              
              
              74,200Warrants
      granted for services
              
              
              -
              
              
              -
              
              
              12,200
              
              
              -
              
              
              -
              
              
              -
              
              
              12,200Interest
      expense for warrants granted
              
              
              -
              
              
              -
              
              
              280,200
              
              
              -
              
              
              -
              
              
              -
              
              
              280,200Common
      shares issued in satisfaction of accounts payableand
      accrued liabilities in the amount of $229,400
              
              
              917,747
              
              
              900
              
              
              228,500
              
              
              -
              
              
              -
              
              
              -
              
              
              229,400Common
      shares issued for repayment of note payable in theamount
      of $99,700, including accrued interest of $14,700
              
              
              702,760
              
              
              700
              
              
              99,000
              
              
              -
              
              
              -
              
              
              -
              
              
              99,700Common
      shares issued for repayment of note payable,related
      party in the amount of $82,700
              
              
              330,747
              
              
              300
              
              
              82,400
              
              
              -
              
              
              -
              
              
              -
              
              
              82,700Deemed
      interest on beneficial conversionfeature
      of notes payable, related party
              
              
              -
              
              
              -
              
              
              17,600
              
              
              -
              
              
              -
              
              
              -
              
              
              17,600Amortization
      of loan fees
              
              
              -
              
              
              -
              
              
              -
              
              
              7,000
              
              
              -
              
              
              -
              
              
              7,000Net
      loss
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (1,030,500
              )
              
              (1,030,500
              )Balance
      December 31, 2004
              
              
              17,860,026
              
              
              17,900
              
              
              5,591,300
              
              
              -
              
              
              -
              
              
              (6,422,800
              )
              
              (813,600
              )Common
      shares issued for cash
              
              
              762,500
              
              
              800
              
              
              152,700
              
              
              -
              
              
              -
              
              
              -
              
              
              153,500Common
      shares issued for exercise of warrants
              
              
              349,545
              
              
              300
              
              
              69,500
              
              
              -
              
              
              -
              
              
              -
              
              
              69,800Net
      loss
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (421,800
              )
              
              (421,800
              )Balance
      December 31, 2005
              
              
              18,972,071
              
              
              19,000
              
              
              5,813,500
              
              
              -
              
              
              -
              
              
              (6,844,600
              )
              
              (1,012,100
              )Common
      shares issued for cash
              
              
              2,448,213
              
              
              2,400
              
              
              642,100
              
              
              -
              
              
              -
              
              
              -
              
              
              644,500Common
      warrants exercised for cash
              
              
              174,000
              
              
              200
              
              
              43,300
              
              
              -
              
              
              -
              
              
              -
              
              
              43,500Common
      shares issued for services
              
              
              19,500
              
              
              -
              
              
              5,000
              
              
              -
              
              
              -
              
              
              -
              
              
              5,000Common
      shares issued in satisfaction of accountspayable
      and accrued liabilities
              
              
              385,714
              
              
              400
              
              
              80,600
              
              
              -
              
              
              -
              
              
              -
              
              
              81,000Common
      shares issued in satisfaction of notespayable-related
      parties
              
              
              56,821
              
              
              100
              
              
              11,800
              
              
              -
              
              
              -
              
              
              -
              
              
              11,900Common
      shares issued in satisfaction of convertibledebenture,
      (including accrued interest of $1,895)
              
              
              206,767
              
              
              200
              
              
              41,700
              
              
              -
              
              
              -
              
              
              -
              
              
              41,900Common
      shares issued for asset acquisition
              
              
              1,000,000
              
              
              1,000
              
              
              399,000
              
              
              -
              
              
              -
              
              
              -
              
              
              400,000Option
      granted to officers and directors
              
              
              -
              
              
              -
              
              
              123,500
              
              
              -
              
              
              -
              
              
              -
              
              
              123,500Warrants
      granted for services
              
              
              -
              
              
              -
              
              
              2,200
              
              
              -
              
              
              -
              
              
              -
              
              
              2,200Warrants
      granted in satisfaction of accountspayable
      and accrued liabilities
              
              
              -
              
              
              -
              
              
              65,400
              
              
              -
              
              
              -
              
              
              -
              
              
              65,400Warrants
      granted in satisfaction of notespayable-related
      parties
              
              
              -
              
              
              -
              
              
              9,600
              
              
              -
              
              
              -
              
              
              -
              
              
              9,600Warrants
      granted in satisfaction of convertibledebenture
              
              
              -
              
              
              -
              
              
              40,000
              
              
              -
              
              
              -
              
              
              -
              
              
              40,000Net
      loss
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (621,000
              )
              
              (621,000
              )Balance
      December 31, 2006
              
              
              23,263,086
              
              
              23,264
              
              
              7,277,736
              
              
              -
              
              
              -
              
              
              (7,465,600
              )
              
              (164,600
              )Common
      shares issued for cash
              
              
              492,795
              
              
              492
              
              
              188,698
              
              
              -
              
              
              -
              
              
              -
              
              
              189,190Common
      warrants exercised for cash
              
              
              745,372
              
              
              745
              
              
              185,598
              
              
              -
              
              
              -
              
              
              -
              
              
              186,343Common
      shares issued for services
              
              
              4,000
              
              
              4
              
              
              2,010
              
              
              -
              
              
              -
              
              
              -
              
              
              2,014Common
      shares issued in satisfaction ofaccrued
      wages of $22,000, related party
              
              
              50,000
              
              
              50
              
              
              21,950
              
              
              -
              
              
              -
              
              
              -
              
              
              22,000Debt
      forgiveness, related party
              
              
              -
              
              
              -
              
              
              147,419
              
              
              -
              
              
              -
              
              
              -
              
              
              147,419Net
      loss
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (604,913
              )
              
              (604,913
              )Balance
      December 31, 2007
              
              
              24,555,253
              
              
              24,555
              
              
              7,823,411
              
              
              -
              
              
              -
              
              
              (8,070,513
              )
              
              (222,547
              )Common
      shares issued for cash
              
              
              32,500
              
              
              33
              
              
              8,092
              
              
              -
              
              
              -
              
              
              -
              
              
              8,125Net
      loss
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (112,679
              )
              
              (112,679
              )Balance,
      March 31, 2008
              
              
              24,587,753
              
              $
              24,588
              
              $
              7,831,503
              
              $
              -
              
              $
              -
              
              $
              (8,183,192
              )
              $
              (327,101
              )




See
Accompanying Notes to Financial Statements


5




CAN-CAL
RESOURCES LTD


(AN EXPLORATION STAGE COMPANY)


CONDENSED
STATEMENTS OF CASH FLOWS


(UNAUDITED)


For
      the Three Months Ended
              
              March 22, 1995March
      31,
              
              (Inception) to2008
              
              2007
              
              December 31, 2007Cash
      flows from operating activities:Net
      loss
              
              $
              (112,679
              )
              $
              (134,674
              )
              $
              (8,183,192
              )Adjustments
      to reconcile net loss to netcash
      used by operating activities:Depreciation
      and amortization
              
              
              2,997
              
              
              2,205
              
              
              240,322Bad
      debts
              
              
              -
              
              
              -
              
              
              207,100(Gain)
      loss on sale of fixed assets
              
              
              -
              
              
              -
              
              
              (6,501
              )Stock
      based compensation
              
              
              -
              
              
              -
              
              
              409,314Stock
      issued for financing and interest
              
              
              -
              
              
              -
              
              
              523,200Beneficial
      conversion feature on convertible debenture
              
              
              -
              
              
              -
              
              
              25,200Common
      stock issued in lieu of accrued wages, related party
              
              
              -
              
              
              -
              
              
              -Loss
      on disposal of investment property
              
              
              -
              
              
              -
              
              
              938,600Undistributed
      earnings of affiliate
              
              
              -
              
              
              -
              
              
              (174,300
              )Gain
      on discontinued operations
              
              
              -
              
              
              -
              
              
              (116,400
              )Stock
      options granted officers and consultants
              
              
              -
              
              
              -
              
              
              123,500Loss
      on foreign currency transalation
              
              
              -
              
              
              -
              
              
              8,500Decrease
      (increase) in assets:Accounts
      receivable
              
              
              -
              
              
              3,649
              
              
              -Other
      current assets
              
              
              (1,995
              )
              
              -
              
              
              (92,695
              )Other
      assets
              
              
              (1,248
              )
              
              (34
              )
              
              (3,143
              )Increase
      (decrease) in liabilities:Accounts
      payable
              
              
              (9,096
              )
              
              (8,627
              )
              
              19,303Accrued
      interest
              
              
              13,510
              
              
              13,792
              
              
              324,830Accrued
      officer salary
              
              
              19,497
              
              
              (5,206
              )
              
              130,149Accrued
      payroll taxes
              
              
              (20,213
              )
              
              (186
              )
              
              1,640Unearned
      revenues
              
              
              (5,625
              )
              
              (5,625
              )
              
              3,750Net
      cash used by operating activities
              
              
              (114,852
              )
              
              (134,706
              )
              
              (5,620,823
              )Cash
      flows from investing activities:Purchase
      of investment property
              
              
              -
              
              
              -
              
              
              (1,083,600
              )Proceeds
      from sale of investment property
              
              
              -
              
              
              -
              
              
              319,300Purchase
      of fixed assets
              
              
              -
              
              
              (20,000
              )
              
              (768,644
              )Proceeds
      from sale of property, equipment and mineral interests
              
              
              -
              
              
              -
              
              
              26,100Net
      cash used by investing activities
              
              
              -
              
              
              (20,000
              )
              
              (1,506,844
              )Cash
      flows from financing activities:Proceeds
      from notes payable
              
              
              -
              
              
              -
              
              
              689,900Principal
      payments on notes payable
              
              
              -
              
              
              -
              
              
              (689,900
              )Proceeds
      from borrowing on notes payable, related parties
              
              
              22,000
              
              
              -
              
              
              709,800Principal
      payments on notes payable, related parties
              
              
              -
              
              
              (3,976
              )
              
              (327,250
              )Proceeds
      from issuance of common stock
              
              
              8,125
              
              
              212,743
              
              
              6,766,377Net
      cash provided by financing activities
              
              
              30,125
              
              
              208,767
              
              
              7,148,927Net
      increase (decrease) in cash
              
              
              (84,727
              )
              
              54,061
              
              
              21,260Cash,
      beginning of period
              
              
              105,987
              
              
              419,700
              
              
              -Cash,
      end of period
              
              $
              21,260
              
              $
              473,761
              
              $
              21,260Supplemental
      disclosure of cash flow information:Cash
      paid for income taxes
              
              $
              -
              
              $
              -
              
              $
              146,228Cash
      paid for interest
              
              $
              -
              
              $
              -
              
              $
              -





See
Accompanying Notes to Financial Statements




6




ITEM 2. NOTES TO FINANCIAL STATEMENTS




CAN-CAL
RESOURCES LTD


(AN EXPLORATION STAGE COMPANY)


NOTES TO
CONDENSED FINANCIAL STATEMENTS


(UNAUDITED)





1.
              BASIS
      OF PRESENTATION





The
accompanying unaudited condensed financial statements have been prepared in
accordance with Securities and Exchange Commission requirements for interim
financial statements. Therefore, they do not include all of the information and
footnotes required by accounting principles generally accepted in the United
States for complete financial statements. The financial statements should be
read in conjunction with the Form 10-KSB for the year ended December 31, 2007 of
Can-Cal Resources Ltd ("the Company").




The
interim condensed financial statements present the balance sheet, statements of
operations, and cash flows of Can-Cal Resources Ltd. The financial statements
have been prepared in accordance with accounting principles generally accepted
in the United States.




The
interim financial information is unaudited. In the opinion of management, all
adjustments (which include normal recurring adjustments) necessary to present
fairly the financial position as of March 31, 2008 and the results of operations
and cash flows presented herein have been included in the financial statements.
Interim results are not necessarily indicative of results of operations for the
full year.




The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.





Exploration Stage
Company





The
Company is currently an exploration stage company. As an exploration stage
enterprise, the Company discloses the deficit accumulated during the exploration
stage and the cumulative statements of operations and cash flows from inception
to the current balance sheet date. The Company has incurred net losses of
$8,183,192 and used net cash in operations of $5,620,823 for the period from
inception (March 22, 1995) through March 31, 2008. An entity remains in the
exploration stage until such time as proven or probable reserves have been
established for its deposits. Upon the location of commercially mineable
reserves, the Company plans to prepare for mineral extraction and enter the
development stage. To date, the exploration stage of the Company’s operations
consists of contracting with geologists to sample and assess the mining
viability of the Company’s claims.




2.
            GOING
      CONCERN





The
Company incurred a net loss of $112,679 for the three months ending March 31,
2008. Also, the Company's current liabilities exceed its current assets by
$838,967 as of March 31, 2008. These factors create substantial doubt about the
Company's ability to continue as a going concern. The Company's management plans
to continue to fund its operations in the short term with a combination of debt
and equity financing, as well as revenue from operations in the long term.




The
ability of the Company to continue as a going concern is dependent on additional
sources of capital and the success of the Company's plan. The financial
statements do not include any adjustments that might be necessary if the Company
is unable to continue as a going concern.





3.
            NOTES
      PAYABLE, RELATED PARTIES





Notes
payable consisted of the following as of March 31, 2008:





Note
      payable to a stockholder, secured by real property, bearing interest at
      16.0% per annum, semi-annual interest only payments, matured November 2005
      (currently in default)
            
            $
            300,000Note
      payable to a stockholder, secured by real property, bearing interest at
      8.0% per annum, matured February 2008 (currently in default)
            
            
            25,114Note
      payable to a stockholder, secured by real property, bearing interest at
      8.0% per annum, matured January 2008 (currently in default)
            
            
            35,436Unsecured
      promissory note payable to a stockholder, bearing interest at 8.0% per
      annum, and a default interest rate of 12.0% per annum, maturing March 10,
      2009
            
            
            22,000Current
      portion (amounts due within one year)
            
            $
            382,550





The
Company is in default of its semi-annual interest payments in the total amount
of $304,000 from 2002 through the present on a note payable of $300,000. The
Company is currently negotiating forbearance on collection of the principle and
interest. Interest expense was $13,804 and $14,580 for the three months ending
March 31, 2008 and 2007, respectively.





The
Company is also in default on two notes payable to a stockholder, which matured
in January 2008 and February 2008, respectively. The principal amount of each
note is $25,114 and $35,436, with accrued interest of $1,362 and $1,922
respectively. Each note bears interest at 8.0% per annum and is secured by real
property. The Company is currently negotiating forbearance on collection of the
principal and interest of each note.





4.
            CHANGES
      IN SECURITIES





1996





During
1996 the Company issued 3,441,217 shares of Can-Cal common stock to various
investors resulting in cash proceeds of $628,400.


7





1997





On
January 15, 1997 the Company issued 500,000 shares of Can-Cal common stock along
with a cash payment of $100,000 in exchange for a 50% interest in S&S Joint
Venture. Additionally, the Company agreed to loan the joint venture up to
$48,000.





On
February 13, 1997 the Board approved the acquisition of Scotmar Industries, Inc.
200,000 shares of Can-Cal common stock were issued in return for all of the
issued and outstanding stock of the acquired company.





On
October 27, 1997 the Board approved the issuance of 2,181,752 restricted common
shares to ARUM, LLC to repay an existing debt of approximately $315,045.98 and
to purchase a property located in San Bernadino County, California, known as the
Pisgah property.





During
November, 1997 the Board approved the sale of 124,683 restricted common shares
to various investors.





During
December, 1997 the Board approved the issuance of 42,000 restricted common
shares in return for services rendered.





1998





In July,
1998 the Board approved the issuance 122,000 restricted common shares to various
investors.





In
October, 1998 the Board approved the sale of 172,450 restricted common shares to
various investors.





During
December, 1998 the Board approved the sale of 263,059 restricted common shares
to various investors.





1999





On
February 1, 1999, the Board of Directors approved the Sale of 62,500 shares of
Can-Cal common stock to a Board member.





On
February 8, 1999 the Board approved the sale of 70,000 shares of Can-Cal common
stock to a Board member.





On March
1, 1999 the Board approved the issuance of 32,121 shares of Can-Cal common stock
in return for services rendered.





On March
15, 1999 the Board approved the sale of 86,000 shares of Can-Cal common stock to
various investors.




On March
17, 1999 the Board approved the issuance of 40,000 shares of Can-Cal common
stock in return for equipment.





On March
10, 1999 the Board approved the sale of 295,500 shares of Can-Cal common stock
to various investors.


8


On April
1, 1999 the Board approved the sale of 1,000 restricted common stock in return
for equipment.





On July
21, 1999 the Board approved the sale of 357,500 shares of common stock to
various investors.





On August
24, 1999 the Board approved the sale of 274,000 shares of common stock to
various investors.





On
September 7, 1999 the Board approved the sale of 20,000 shares of common stock
to an investor.





On
November 9, 1999 the board approved the issuance of 10,000 shares of common
stock to an investor.





2000





On
February 27, 2000, the Board of Directors approved the sale of 500,000 shares of
common stock to three of its directors (all of whom reside in Canada), an
offshore trust and another person affiliated with the Company.





On July
3, 2000, the Board of Directors exercised the option to acquire technology
related to the extraction and processing of ore and, in accordance with the
agreement with the two owners of that technology, issued 200,000 shares of
Can-Cal's common stock to them.





On
November 24, 2000, the Company borrowed $300,000 from a lender. As part of the
transaction, the Company issued 45,000 shares of its common stock as a loan
placement fee and granted the lender an option to purchase up to 300,000 shares
of its common stock. On November 24, 2000, the lender exercised its option in
full and purchased 300,000 shares of Can-Cal's common stock.





In July
2000 the Board of Directors authorized the sale of 74,009 shares of its common
stock to eight persons, all of whom reside outside the United States. During the
third quarter 46,670 shares were sold and the remaining 27,339 shares were sold
during the fourth quarter. All of those shares were issued on December 15,
2000.





2001





In
September, 2001, the Board of Directors authorized the sale of 20,000 shares of
its common stock to an individual.





During
October, 2001 the company signed an Investment Agreement with two funds
(Dutchess Private Equities Fund LP and DRH Investment Company LLC) to sell to
those funds up to $8,000,000 in common stock of the company, for a period of
three years. In connection with the Investment Agreement, the company issued
606,059 shares of restricted common stock to Dutchess Fund and its advisor, and
to a broker-dealer firm, for services valued at $400,000, to induce those
entities to enter into the Investment Agreement and perform services
contemplated under such agreement. The company also issued 37,000 shares of
restricted common stock to the attorney for Dutchess Fund.




On
November 2, 2001 the Board of Directors approved the sale of 82,888 shares of
restricted common stock.





On
December 12, 2001 the Board of Directors approved the sale of 40,000 shares of
restricted common stock.




2002





On
January 8, 2002, we sold 36,000 restricted common shares to three investors (one
Canadian resident, and two private companies controlled and owned by Canadian
residents) for $12,600 cash ($0.35 per share, representing a discount of
approximately 50% from market price). These investors also were issued warrants
to purchase 36,000 additional restricted shares, at a price of $0.35 per share;
the warrants will expire January 8, 2004.





On
February 11, 2002, 10,000 restricted common shares were sold to one investor (a
Canadian resident) for $3,500 cash ($0.35 per share, representing a discount of
approximately 50% from market price). This investor also was issued warrants to
purchase 10,000 additional restricted shares, at a price of $0.35 per share; the
warrants will expire February 11, 2004. Complete information about the company
was provided to these investors. These shares and warrants were sold pursuant to
the exemption provided by Regulation S of the 1933 Act. No commissions were
paid.





On
January 31, 2002, we issued 309,677 restricted common shares to a lender (First
Colony Merchant) for payment of past due and current interest on debt, $119,800.
No commissions were paid.





From
March 1, 2002 through June 3, 2002, 369,600 restricted common shares were issued
to 48 investors (all Canadian residents or companies controlled and owned by
Canadian residents) for $92,400 cash ($0.25 per share, representing discounts
ranging from 0% to approximately 50% from market prices at the time of
issuance). These investors also were issued warrants to purchase 369,600
additional restricted shares, at a price of $0.25 per share; the warrants will
expire two years from the date of issuance. No commissions were
paid.





On June
21, 2002, 40,000 restricted common shares were issued to Financial
Communications Corp. for public relations services, valued at approximately
$14,000.





From July
1, 2002 through December 24, 2002, 609,720 restricted common shares were issued
to 20 investors (19 whom are Canadian residents or companies controlled and
owned by Canadian residents, and one who is a resident of Great Britain) for
$152,400 cash ($0.25 per share, representing prices that ranged from 22% over
market to approximately 40% below market prices at the time of issuance). The
investors also were issued warrants to purchase a total of 609,720 additional
restricted shares, at a price of $0.25 per share; the warrants will expire two
years from the date of issuance. No commissions were paid.





During
September 2002, the Company issued 32,281 shares of the Company's common stock
for $5,500 in cash related to the Dutchess Private Equities Fund, net of
offering costs of $200, and issued 30,000 shares to Joseph B. LaRocco, attorney
for Dutchess Fund and DRH Investment Company, LLC for legal services to such
entities.


9


During
October 2002, the Company issued 35,679 shares of the Company's common stock for
$4,600 in cash related to the Dutchess Private Equities Fund, net of offering
costs of $700.





In
November 2002, the Company issued 52,292 restricted common shares to four
individuals in exchange for various services, valued at approximately
$9,900.





2003





During
2003, 673,410 restricted common shares were issued to 19 Canadian residents or
companies controlled and owned by Canadian resident investors for $134,682 and
150,000 restricted common shares were issued to 12 U.S. resident investors for
$30,000 (all shares were priced at $0.20 per share, representing premiums of up
to 25% and discounts ranging from 0% to approximately 25% from market prices at
the time of issuance). With respect to 237,410 restricted common shares, the
investors were also issued warrants to purchase 474,820 additional restricted
common shares and with respect to 473,500 restricted common shares, the
investors were also issued warrants to purchase 473,500 additional restricted
common shares; all warrants were priced at $0.20 per share and will expire two
years from the date of issuance. With respect to 112,500 restricted common
shares, the investors were also issued 112,500 warrants to purchase additional
restricted common shares, at a price of $0.25 per share for a period of two
years from the date of issuance. The shares and warrants were sold to Canadian
investors pursuant to the exemption provided by Regulation S of the 1933 Act,
and the shares and warrants sold to U.S. investors were sold pursuant to the
exemption provided by section 4(2) of the 1933 Act.





During
2003, 364,305 restricted common shares were issued in conversion of $35,000
principal and interest on a debenture held by Dutchess Fund. The conversion
prices were $0.099 for 50,710 shares ($5,000 of the debenture); $0.112 for
44,643 shares ($5,000 of the debenture); $0.061 for 81,433 shares ($5,000 of the
debenture); $0.067 for 75,075 shares ($5,000 of the debenture); and $0.1334 for
112,444 shares ($15,000 of the debenture). All of the prices were determined by
the conversion formula in the debenture (80% of the average bid prices for the
three lowest (out of 15) trading days before conversion. These shares were sold
pursuant to the exemption provided by section 4(2) of the 1933 Act.





During
2003, 205,166 restricted common shares in payment of $31,500 of services by Luis
Vega, consulting geologist. The per share price was determined by dividing the
amount owed by the average closing price of the company's stock for each day's
service. These shares were sold pursuant to the exemption provided by section
4(2) of the 1933 Act.




On March
14, 2003, 24,960 restricted common shares were issued to Catherine Nichols, a
Canadian resident, for marketing services amounting to $5,000. The price per
share was based on the average closing share price for the period during which
the services were rendered. These shares were sold pursuant to the exemption
provided by Regulation S of the 1933 Act.





During
the period from July 15 to December 31, 2003, 112,326 restricted common shares
in payment of $22,250 of investor relations services by Jeffrey Whitford, a
Canadian resident who is a consultant to the company. The price per share was
based on the average monthly closing share prices for the period. These shares
were sold pursuant to the exemption provided by Regulation S of the 1933
Act.




33,600
restricted common shares were issued to pay $4,200 of legal services provided by
Stephen E. Rounds, outside company counsel. The price per share was based on the
average closing share price for the period during which the services were
rendered. These shares were sold pursuant to the exemption provided by section
4(2) of the 1933 Act.





On
December 30, 2003, 5,208 restricted common shares were issued to Terry Brown, a
Mexican resident, for technical consulting services amounting to $1,250. The
price per share was based on the average closing share price for the period
during which the services were rendered. These shares were sold pursuant to the
exemption provided by Regulation S of the 1933 Act.





2004





During
2004, 2,255,586 restricted common shares were issued to 107 Canadian residents
or companies controlled and owned by Canadian resident investors for $431,425
and 10,000 restricted common shares were issued to one U.S. resident investor
for $2,000 (245,000 shares were priced at $0.18 per share, 1,620,131 shares were
priced at $0.20 per share, 261,200 shares were priced at $0.25 per share, and
139,255 shares were issued as a 25% premium on the conversion of warrants,
representing premiums of up to 25% and discounts ranging from 0% to
approximately 25% from market prices at the time of issuance). With respect to
1,319,308 of these restricted common shares, the investors were also issued
warrants to purchase 1,259,308 additional restricted common shares at $0.25 per
share and 60,000 additional restricted common shares at $0.20 per share. With
respect to 245,000 restricted common shares, the investors were also issued
warrants to purchase 245,000 additional restricted common shares at $0.25, and
with respect to another 245,000 restricted common shares, the investors were
also issued warrants to purchase 245,000 additional restricted common shares at
$0.50 per share. Of these, we also sold 5,000 shares to a director of the
Company for proceeds of $1,000 and issued warrants to purchase 5,000 restricted
common shares, exercisable at $0.25 per share for a two year period. All
warrants will expire two years from the date of issuance. The shares and
warrants were sold to Canadian investors pursuant to the exemption provided by
Regulation S of the 1933 Act, and the shares and warrants sold to U.S. investors
were sold pursuant to the exemption provided by section 4(2) of the 1933
Act.





During
2004, 702,760 restricted common shares were issued in conversion of $99,657
principal and interest on a debenture held by Dutchess Fund. The conversion
prices were $0.216 for 92,593 shares ($20,000 of the debenture); $0.160 for
31,250 shares ($5,000 of the debenture); $0.144 for 34,722 shares ($5,000 of the
debenture); $0.128 for 544,195 shares ($69,657 of the debenture). All of the
prices were determined by the conversion formula in the debenture (80% of the
average bid prices for the three lowest (out of 15) trading days before
conversion). These shares were sold pursuant to the exemption provided by
section 4(2) of the 1933 Act.





During
2004, 215,336 restricted common shares were issued in payment of $40,932 of
services by Luis Vega, consulting geologist. The price per share was determined
by dividing the amount owed by the average closing price of the company's stock
for each day's service. These shares were sold pursuant to the exemption
provided by section 4(2) of the 1933 Act.


10


On
February 4, 2004, 10,000 restricted common shares were issued to Yvonne St.
Pierre, a Canadian resident, for computer-related services, in the amount of
$2,500. These shares were issued pursuant to the exemption provided by
Regulation S of the 1933 Act.





Between
February 10 and March 31, 2004, 75,000 restricted common shares were issued to
Jeff Whitford, a Canadian resident, for investor relation services, in the
amount of $15,000. In addition, Mr. Whitford received 50,000 warrants at an
exercise price of $0.20 per share; the warrants will expire between February
2006 and March 2006. The warrants were valued at $12,200 utilizing the Black
Scholes model. These shares were issued pursuant to the exemption provided by
Regulation S of the 1933 Act.





On
December 22, 2004, 2,500 restricted common shares were issued to Karen Barra, a
U.S. resident, for services amounting to $500. The price per share was $0.20
based on private placement offering for the period during which the services
were rendered. These shares were sold pursuant to the exemption provided by
Regulation S of the 1933 Act.





During
2004, 15,367 restricted common shares were issued in payment of accounts payable
amounting to $3,842. The price per share was based on the average closing share
price for the period during which the services were rendered. These shares were
sold pursuant to the exemption provided by Regulation S of the 1933
Act.





During
2004, 87,388 restricted common shares were issued to Terry Brown, a Mexican
resident, for technical consulting services amounting to $15,247. The price per
share was based on the average closing share price for the period during which
the services were rendered. These shares were sold pursuant to the exemption
provided by Regulation S of the 1933 Act.





On March
1, 2004, in connection with the conversion of $82,687 in notes payable and
$225,595 in accrued officers' salary payable, we issued 1,233,127 restricted
common shares at $0.25 per share and 1,233,127 warrants, with an exercise price
of $0.30 and expiring on March 1, 2006, to two officers, two directors, and a
former director and his insurance agency. These persons and the insurance agency
are accredited investors.





2005





During
the twelve months ended December 31, 2005, we sold 712,500 restricted common
shares to 21 Canadian residents for a total of $142,500, and issued warrants to
purchase 712,500 restricted common shares, exercisable at $0.25 per share. These
securities were issued in private transactions in reliance on the exemption from
registration with the SEC provided by Regulation S.





A prior
U.S. shareholder exercised other warrants, at exercise prices ranging from
$0.22, for proceeds of $11,000, which resulted in the issuance of 50,000
restricted common shares. These securities were issued in private transactions
in reliance on the exemption available under Section 4(2) of the 1933
Act.




We also
issued, for services, 349,545 restricted common shares for a total value of
$69,800 valued at fair market value at date of issuance and granted 13,575
warrants (exercisable for two years at $0.25 per share) valued at fair market
value at date of issuance. These securities were issued to two Canadian
residents, and one Mexican Corporation in reliance on the exemption from
registration available under Regulation S, and one U.S. resident, in reliance on
the exemption provided by Section 4(2) of the 1933 Act.





2006





During
the twelve months ended December 31, 2006, we sold 2,622,213 restricted common
shares to 76 Canadian residents, 8 US residents, 5 Israeli Nationals and 1 Swiss
National for a total of $688,000, and issued warrants to purchase 2,348,213
restricted common shares, exercisable between $0.25 to $.45 per share. These
securities were issued in private transactions, with respect to the Canadian
residents, in reliance on the exemption from registration with the SEC provided
by Regulation S, and with respect to the U.S. citizen, in reliance on the
exemption available under Section 4(2) of the 1933 Act.





We also
issued, for services, 8,500 restricted common shares for a total value of $2,325
and these securities were issued to one U.S. resident in reliance on the
exemption provided by Section 4(2) of the 1933 Act.





On July
3, 2006, the Company issued 2,200 shares of its par value common stock for
services received by an individual. As of September 30, 2006, the Company
recorded consulting expense in the amount of $462, the fair value of the shares
issued on the date of grant. Additionally, the Company granted a warrant to
purchase 2,200 shares of the Company's common stock at an exercise price of
$0.25 for a period of 2 years. The Company recorded an expense in the amount of
$373, the fair value of the warrant on the date of grant. Fair value was
determined using the Black Scholes option pricing model based on the following
assumptions: expected dividends: $-0-; volatility: 187%; risk free interest
rate: 5.12%.





On July
3, 2006, the Company issued 8,800 shares of its par value common stock for
services received from an individual. As of September 30, 2006, the Company
recorded consulting expense in the amount of $2,200, the fair value of the
shares issued on the date of grant. Additionally, the Company granted a warrant
to purchase up to 8,800 shares of the Company's common stock at an exercise
price of $0.25 for a period of 2 years. The Company recorded an expense in the
amount of $1,812, the fair value of the warrant on the date of grant. Fair value
was determined using the Black Scholes option pricing model based on the
following assumptions: expected dividends: $-0-; volatility: 187%; risk free
interest rate: 5.12%.




On July
3, 2006, an officer of the Company elected to convert half of his accrued salary
in exchange for 385,714 shares of common stock valued at $81,000, the fair value
of the shares issued on the date of grant. Additionally, the Company granted a
warrant to purchase up to 385,714 shares of the Company's common stock at an
exercise price of $0.25 for a period of two years. The Company recorded an
expense in the amount of $65,418, the fair value of the warrant on the date of
grant. Fair value was determined using the Black Scholes option pricing model
based on the following assumptions: expected dividends: $-0-; volatility: 187%;
risk free interest rate: 5.12%.


11


On July
3, 2006, the Company issued 56,821 shares of its common stock for conversion of
a note in the amount of $11,932 from a shareholder of the Company. Additionally,
the Company granted a warrant to purchase up to 56,821 shares of the Company's
common stock at an exercise price of $0.25 for a period of two years. The
Company recorded an expense in the amount of $9,637, the fair value of the
warrant on the date of grant. Fair value was determined using the Black Scholes
option pricing model based on the following assumptions: expected dividends:
$-0-; volatility: 187%; risk free interest rate: 5.12%.





On July
11, 2006, the Company issued 206,767 shares of its par value common stock
pursuant to the convertible debenture agreement entered into on January 24, 2006
whereby the Company received a $40,000 convertible at a rate of $0.20 per share
bearing interest of 10% per annum. The note holder elected to convert all
accrued interest totaling $1,895 into 6,767 shares of the Company's par value
common stock.





On August
22, 2006, the Company entered into an agreement to purchase mining claims
located in Mohave County, Arizona in exchange for 1,000,000 shares of the
Company's par value common stock. The Company recorded an asset totaling $400,000,
the fair value of the underlying shares.





2007





During
the twelve months ended December 31, 2007, we sold 1,238,167 restricted common
shares to 72 Canadian residents and 4 US residents for a total of $375,534 and
issued warrants to purchase 492,795 restricted common shares, exercisable
between $0.35 to $.65 per share. These securities were issued in private
transactions, with respect to the Canadian residents, in reliance on the
exemption from registration with the SEC provided by Regulation S, and with
respect to the U.S. citizen, in reliance on the exemption available under
Section 4(2) of the 1933 Act.





On April
30, 2007, the Company also issued 50,000 shares of restricted common stock as
part of a settlement agreement with a former officer of the Company for
compensation of accrued salaries. The common stock was rendered to a U.S.
citizen, in reliance on the exemption available under Section 4(2) of the 1933
Act. The shares were valued at a total of $22,000. In addition to monthly cash
payments of $3,500 per month the Company has recorded debt forgiveness of
$147,419 in accordance with the terms of the settlement agreement. Due to the
related party nature of the transaction the gain has been recorded to additional
paid in capital, therefore there has been no impact on the Company’s net loss.




On June
29, 2007, the Company also issued 4,000 shares of restricted common stock for
services rendered to a U.S. citizen, in reliance on the exemption available
under Section 4(2) of the 1933 Act. The shares were valued at a total of
$2,000.





2008





During
the three months ending March 31, 2008, the Company sold 32,500 restricted
shares of common stock along with warrants to purchase an additional 32,500
shares of the Company's common stock to various accredited Canadian and US
citizens for total proceeds of $8,125. The warrants were fully vested, are
exercisable at $0.35 per share, and expire two years from the date of issuance.
These securities were issued in private transactions, with respect to the
Canadian resident, in reliance on the exemption from registration with the SEC
provided by Regulation S, and with respect to the U.S. citizen, in reliance on
the exemption available under Section 4(2) of the 1933 Act.




Previously
issued warrants to purchase 23,500 shares of the Company's common stock expired
during the three months ending, March 31, 2008.





5.
            COMMITMENTS
      AND CONTINGENCIES





Operating
lease – The Company operates from a leased facility in Nevada under a month
to month basis. The lease calls for monthly base rent of approximately $1,500.





6.
            SUBSEQUENT
      EVENTS





On May 7,
2008 the Company's CEO loaned $20,000 to the Company. The unsecured promissory
note bears interest at 8% and matures on May 7, 2009.





ITEM 2.
MANAGEMENT'S DISCUSSION AND ANALYSIS





(A) PLAN
OF OPERATION.





Can-Cal
Resources Ltd. is a public company engaged in seeking the acquisition and
exploration of metals mineral properties. As part of its growth strategy, the
Company will focus its future activities in the USA, with an emphasis on the
Pisgah Mountain, California property and the Wikieup, Arizona property.





The
Company has discontinued all industrial sales for the volcanic materials located
on the Pisgah property in California subject to the finalization of the current
analytical program.





At May
19, 2008, we had approximately $30,209 cash available to sustain operations.
Accordingly we are uncertain as to whether the Company may continue as a going
concern. While we may seek additional investment capital, or possible funding or
joint venture arrangements with other mining companies, we have no assurance
that that such investment capital or additional funding and joint venture
arrangements will be available to the Company.





(B)
RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2008 AND
2007.





The
following table summarizes selected items from the statement of operations for
the three months ended March 31, 2008 compared to March 31,
2007.


12


EXPENSES:





Three Months EndedMarch 31,2008
            
            2007
            
            Increase / (Decrease)Amount
            
            Amount
            
            $
            
            %Expenses:Exploration
      costs
            
            $
            17,914
            
            $
            47,308
            
            $
            (29,394
            )
            
            (62
            )%Depreciation
            
            
            2,997
            
            
            2,205
            
            
            792
            
            
            36
            %General
      & administrative expenses
            
            
            56,995
            
            
            48,494
            
            
            8,501
            
            
            18
            %General
      & administrative expenses, related party
            
            
            30,992
            
            
            31,166
            
            
            (174
            )
            
            (1
            )%Total
      operating expenses
            
            
            108,898
            
            
            129,173
            
            
            (20,275
            )
            
            (16
            )%Loss
      from operations
            
            
            (108,898
            )
            
            (129,173
            )
            
            (20,275
            )
            
            (16
            )%Other
      income (expense):Interest
      income
            
            
            98
            
            
            3,454
            
            
            (3,356
            )
            
            (97
            )%Rental
      revenue
            
            
            9,925
            
            
            5,625
            
            
            4,300
            
            
            76
            %Interest
      expense
            
            
            (13,804
            )
            
            (14,580
            )
            
            (776
            )
            
            (5
            )%Total
      other income (expense)
            
            
            (3,781
            )
            
            (5,501
            )
            
            (1,720
            )
            
            (31
            )%Net
      loss
            
            $
            (112,679
            )
            $
            (134,674
            )
            $
            (21,995
            )
            
            (16
            )%





EXPLORATION
COSTS





Exploration
costs for the three months ended March 31, 2008 decreased by $29,394 or 62% from
$47,308 for the three months ended March 31, 2007 to $17,914 for the three
months ended March 31, 2008. The decrease is due to our efforts to scale back on
further research as a result of the Cease Trade Order issued by the British
Columbia Securities Commission and therefore causing the inability to provide
Private Placement funding necessary to maintain operations.




Unless
the Company is able to establish the economic viability of its mining
properties, the Company will continue writing off its expenses of exploration
and testing of its properties. Therefore, losses will continue unless the
Company sells one or more of its properties or locates and delineates reserves
and initiates mining operations. If that occurs, the Company may capitalize
certain of those expenses.





The
Company has no material commitments for capital expenditures other than
expenditures it chooses to make with respect to testing and or exploration of
its mineral properties.





DEPRECIATION





Depreciation
for the three months ended March 31, 2008 increased by $792 or 36% from $2,205
for the three months ended March 31, 2008 to $2,997 for the three months ended
March 31, 2008. The increase is principally due to additional depreciation on
equipment that was purchased after March 31, 2007.





GENERAL
AND ADMINISTRATIVE EXPENSES





General
and administrative expenses for the three months ended March 31, 2008 increased
by $8,501 or 18% from $48,494 for the three months ended March 31, 2007 to
$56,995 for the three months ended March 31, 2008. The increase is principally
due to increased costs to maintain the office, including increased utility costs
and payroll taxes associated with moving some of the administrative functions in
house.




GENERAL
AND ADMINISTRATIVE EXPENSES, RELATED PARTY





General
and administrative expenses, related party for the three months ended March 31,
2008 decreased by $174 or 1% from $31,166 for the three months ended March 31,
2007 to $30,992 for the three months ended March 31, 2008.





TOTAL
OPERATING EXPENSES





Total
operating expenses for the three months ended March 31, 2008 decreased by
$20,275 or 16% from $129,173 for the three months ended March 31, 2007 to
$108,898 for the three months ended March 31, 2008. The decrease in total
operating expenses was mainly a result of management's efforts to scale back
exploration costs until the Company has the resources to effectively explore the
claims that have been obtained.




OTHER
INCOME (EXPENSE)





Interest
income for the three months ended March 31, 2008 decreased by $3,356 or 97% from
$3,454 for the three months ended March 31, 2007 to $98 for the three months
ended March 31, 2008. Interest income relates to interest earned on cash
received as a result of financing activities, of which less was on hand during
the three months ended March 31, 2008 compared to the same period in 2007.





Rental
revenue for the three months ended March 31, 2008 increased by $4,300 or 76%
from $5,625 for the three months ended March 31, 2007 to $9,925 for the three
months ended March 31, 2008. Rental revenue relates to income derived from the
rental of the Company's land for the purposes of filming movies or photo shoots.
More photo shoots were performed during the three months ended March 31, 2008
compared to the same period in 2007.





Interest
expense for the three months ended March 31, 2008 decreased by $776 or 5% from
$14,580 for the three months ended March 31, 2007 compared to $13,804 for the
three months ended March 31, 2008.





NET LOSS





Our net
loss was $112,679 for the three months ended March 31, 2008 compared to a net
loss of $134,674 for the three months ended March 31, 2007. We expect to improve
our results of operations through the attainment of sufficient working capital
and a focus on generating revenues from the subcontracting of mining activities,
and a reduction of general and administrative expenses.





(D)
LIQUIDITY AND CAPITAL RESOURCES AND RESULTS OF OPERATIONS





The
following table summarizes total current assets, total current liabilities and
working capital at March 31, 2008 compared to December 31, 2007.  13





March 31,
            
            December 31,
            
            INCREASE / (DECREASE)2008
            
            2007
            
            $
            
            %Current Assets
            
            $
            23,255
            
            $
            105,987
            
            $
            (82,732
            )
            
            (78
            )%Current
      Liabilities
            
            $
            862,222
            
            $
            842,149
            
            $
            20,073
            
            
            .02
            %Working
      Capital (deficit)
            
            $
            (836,967
            )
            $
            (736,162
            )
            $
            100,805
            
            
            14
            %





Internal
and External Sources of Liquidity





During
the three months ended March 31, 2008 and 2007, our operating and investing
activities used cash of $114,852 and $154,706, respectively, while our financing
activities provided cash of $30,125 and $208,767, respectively. The cash used in
operating activities was principally a result of the net loss we
incurred.





Cash
Flow. Since inception, we have primarily financed our cash flow requirements
through the issuance of common stock and the issuance of notes. With the growth
of our current business we may, during our normal course of business, experience
net negative cash flows from operations until some of our mining activities
begin to produce revenues. Further, we may be required to obtain financing to
fund operations through additional common stock offerings and bank or other debt
borrowings, to the extent available, or to obtain additional financing to the
extent necessary to augment our available working capital.





SATISFACTION
OF OUR CASH OBLIGATIONS FOR THE NEXT TWELVE MONTHS.





As of May
19, 2008, our cash balance was $30,209. Our plan for satisfying our cash
requirements for the next twelve months is through additional equity, third
party financing, and/or debt financing. We anticipate our current cash reserves
will be sufficient to support operations through June 30, 2008, but do not
anticipate generating sufficient amounts of positive cash flow to meet our
working capital requirements. Consequently, we intend to make appropriate plans
to ensure sources of additional capital in the future to fund growth and
expansion through additional equity or debt financing or credit facilities. We
also are considering possible funding through joint venture arrangements with
other mining companies. There can be no assurance that we will raise capital
through any of these means.




As we
expand operational activities, we may continue to experience net negative cash
flows from operations, pending receipt of sales and will be required to obtain
additional financing to fund operations through common stock offerings and debt
borrowings to the extent necessary to provide working capital.





We
anticipate incurring operating losses until we build our capital base. Our
recent operating history makes predictions of future operating results difficult
to ascertain. In addition, since our cash position has fallen we are finding it
increasingly difficult to expand our operations. Thus, our prospects must be
considered in light of the risks, expenses and difficulties frequently
encountered by companies in their early stages of commercial viability,
particularly companies in rapidly evolving energy markets. Such risks include,
but are not limited to, an evolving and unpredictable business model and the
management of growth. To address these risks we must, among other things,
implement and successfully execute our business and marketing strategy, continue
to develop and upgrade technology and products, respond to competitive
developments, and continue to attract, retain and motivate qualified personnel.
There can be no assurance that we will be successful in addressing such risks,
and the failure to do so can have a material adverse effect on our business
prospects, financial condition and results of operations.




ITEM 3.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.





Not
applicable.





ITEM 4T.
CONTROLS AND PROCEDURES





The
Company maintains disclosure controls and procedures that are designed to ensure
that information required to be disclosed in the Company’s Exchange Act reports
is recorded, processed, summarized and reported within the time periods
specified in the SEC’s rules and forms, and that such information is accumulated
and communicated to the Company’s management, including its Chief Executive
Officer and Chief Financial Officer, as appropriate, to allow timely decisions
in accordance with the required "disclosure controls and procedures" as defined
in Rule 13a-15(e). The Company’s disclosure and control procedures are designed
to provide reasonable assurance of achieving their objectives, and the principal
executive officer and principal financial officer of the Company concluded that
the Company’s disclosure controls and procedures were effective at the
reasonable assurance level.





At the
end of the period covered by this Quarterly Report, the Company carried out an
evaluation, under the supervision and with the participation of the Company's
management, including the Company's principal executive officer and principal
financial officer, of the effectiveness of the design and operation of the
Company's disclosure controls and procedures. Based of the foregoing, the
principal executive officer and principal financial officer of the Company
concluded that the Company’s disclosure controls and procedures were effective
to ensure that the information required to be disclosed in the Company’s
Exchange Act reports is recorded, processed, summarized and reported within the
time periods specified in the SEC’s rules and forms, and that such information
is accumulated and communicated to the Company’s management including the
Company’s principal executive officer and principal financial officer to allow
timely decisions regarding required disclosure.





Changes
in Internal Control over Financial Reporting




There
were no changes in our internal control over financial reporting, as defined in
Rules 13a-15(f) and 15d-15(f) under the Exchange Act, during our most recently
completed fiscal quarter that have materially affected, or are reasonably likely
to materially affect, our internal control over financial
reporting.


14


PART II -
OTHER INFORMATION





ITEM 1.
LEGAL PROCEEDINGS





The
Company is not currently a party to litigation. The British Columbia Securities
Commission has recently required the Company to obtain a report by an
independent consultant qualified under the standards of the BCSC. Under British
Columbia securities laws, all disclosure of scientific or technical information,
including disclosure of a mineral resource or mineral reserve must be based on
information prepared by or under the supervision of an independent third party
who is "qualified" under the terms of that law. The Company is under order to
supply such verification by a "qualified" third party consultant, and its stock
may not trade in British Columbia until such verification is accepted by the
BCSC. The BCSC has also requested documentation regarding all subscribers to the
Company stock who are resident in British Columbia. The Company has retained
such a "qualified" third party consultant who is in the process of preparing and
filing the necessary reports with the BCSC.





ITEM 2.
CHANGES IN SECURITIES.





During
the three months ended March 31, 2008, and prior to February 7, 2008, the
Company sold 32,500 shares of restricted common stock and 32,500 warrants to
purchase 32,500 shares of common stock to an accredited Canadian investor and
one United States investor for a total of $8,125.00. The warrants are
exercisable at a price of $0.35 per share and expire two years from the date of
issuance. These securities were issued in private transactions, with respect to
the Canadian resident, in reliance on the exemption from registration with the
SEC provided by Regulation S and with respect to the United States investor, in
reliance upon the exemption from registration provided under Section 4(2) of the
1933 Securities Act.




Previously
issued warrants to purchase 23,500 shares of the Company's common stock expired
during the three months ending March 31, 2008.





ITEM 3.
DEFAULTS UPON SENIOR SECURITIES





The
Company is in default on a note payable for $300,000 and its semi- annual
interest payments of $280,000 for the years ended 2002 - 2007, and the three
months ended March 31, 2008. The Company is currently negotiating forbearance on
collection of the principal and interest. The Company is also in default on two
notes payable to a stockholder, which matured in January 2008 and February 2008,
respectively. The principal amount of each note is $25,114 and $35,436, with
accrued interest of $1,362 and $1,922 respectively. Each note bears interest at
8.0% per annum and is secured by real property. The Company is currently
negotiating forbearance on collection of the principal and interest of each
note.





ITEM 4.
SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS





None.





ITEM 5.
OTHER INFORMATION





N/A




ITEM 6.
EXHIBITS AND REPORTS ON FORM 8-K





31.1
            Certification
      under Rule 13a-14(a)32.1
            Certification
      under Rule 13a-14(b)





SIGNATURES





In
accordance with the requirements of the Exchange Act, the registrant caused this
report to be signed on its behalf by the undersigned, thereunto duly
authorized.





CAN-CAL
      RESOURCES LTD.(REGISTRANT)Date:
      May 20, 2008
            By:
            /s/
      Ronald D. SloanRONALD
      D. SLOAN,Chief
      Executive Officer and President




15